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| Goldman Sachs Expects Fed to Pause at March Meeting Due to Banking System Stress |
According to a report by Goldman Sachs, the US Federal Reserve (Fed) is expected to pause at its March meeting this week due to the stress in the banking system. Despite the aggressive response from policymakers to support small and midsize banks, the markets remain unconvinced that these efforts will be sufficient.
The report also suggests that there may be a pause in the inflation fight, but that this should not pose a significant problem. The goal of bringing inflation back to 2% is seen as a medium-term goal, which the Fed expects to solve gradually over the next two years. The Fed is also seen as able to get back on track quickly if necessary, and the banking stress could even have disinflationary effects.
Overall, the report by Goldman Sachs suggests that the Fed is likely to pause at its March meeting due to the stress in the banking system. However, the situation is expected to be temporary, and the Fed is seen as able to quickly get back on track if needed. Investors will be closely watching for any announcements from the Fed regarding its rate hike decision, as well as any updates on the state of the banking system.
